In the analyst's view, the stock is down significantly as a result of an excess number of deaths for patients receiving the drug. However, he thinks it is important to be mindful that these lupus nephritis patients were extremely sick and treated at many sites. The company noted that there were no clear underlying patterns among the deaths.

"The Ph.2b AURA study investigating voclosporin in lupus nephritis (LN) pts. met its primary endpoint of complete remission (CR; p=0.045) and improvements in partial remission (PR; p=0.007) vs. pbo. While efficacy was higher among pts. receiving the low dose, the high-dose cohort also achieved meaningful improvements in PR (p=0.024). Meanwhile, the stock is trading down due to more deaths (n=10) for patients in the low-dose cohort, which the company attributes to the severe underlying nature of the disease," said Schwartz.

"CR, defined as urinary protein/creatinine ratio of ≤0.5 mg/ mg at 24 weeks, was noticeably higher among voclosporin-receiving pts. -- 32.6% (low-) and 27.3% (high-dose) -- compared to 19.3% seen in pbo. arm. Efficacy in PR (50% reduction in UPCR vs. baseline) also favored voclosporin -- 69.7% (low-; p=0.007) and 65.9% (high-dose; p=0.024) -- vs. 49.4% in pbo. arm. It is also worth noting that time to CR and PR were both shorter for voclosporin groups, which substantiates the response rates," continued the analyst.

Commenting on its adverse event profile, the analyst said, "Unlike the overall rate of adverse events (AEs), a higher rate of serious AEs (SAEs) was observed in both voclosporin arms, an observation consistent with highly active disease. There were 13 reported deaths, 12 of which were in the voclosporin arms (2 in high-dose vs. 10 in low-dose) and 11/13 occurred in Asia. Although details are lacking at this early stage of data analysis, mgmt. noted 3 possible reasons: 1) randomization resulted in more Asian pts. receiving low-dose voclosporin, 2) differences in pt. management/ lack of treatment, and 3) severity of underlying disease. Whereas the noticeably higher deaths in voclosporin arms obviously triggers some caution among investors, we look forward to future updates. Management noted there were four deaths due to infection in the low dose, and a smattering of other causes related to lupus, some very soon after entering the study, and all resembling the underlying cause of disease."

Schwartz continued, "At first glance, the efficacy seen in the drug arms looks lower than what we had expected, but still respectable. The study was 80% powered to detect a remission rate of 41% for the drug versus 20% for placebo based on a planned sample size of 258 subjects. CR rates as low as 35% vs. 15% or as high as 47% versus 25% would also maintain 80% power. The reverse dose response was surprising, particularly since this would have been pulled down by accounting for the relatively high number of deaths in the drug arm."

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